Uganda's plan to dam Nile sparks controversy

From Nairobi Bureau Chief Catherine Bond

BUJAGALI, Uganda (CNN) -- The government of Uganda and the tourist industry are fighting over the power of the Nile River and how best to capture it for the country's economic health.

International power giant AES has won a contract to dam the world's longest river, but the action will destroy a spectacular set of rapids and one of the country's top tourist attractions.

The dam is to go up at Bujagali Falls, the exact spot that has been drawing tourists to run the world's largest commercially accessible rapids. Once the dam is built, the run will become little more than a placid lake.

Uganda's power shortage is the single greatest obstacle to the country's economic growth. Demand is growing so fast that electricity is rationed almost daily, retarding industry and sometimes even crippling it.

Power in short supply

"We've been growing over the last five years at about 7 percent per annum," says Emmanuel Tumusiime-Mutebile of the Ugandan Finance Ministry. "I think we would have been growing by 9 percent had it not been for power shortages, so I think it is slashing off a full 2 percent from our growth rate."

Bujagali Falls may well go the way of Victoria Falls, at the headwater of the Nile. That waterfall disappeared in 1954 when a dam vital to both Uganda and Kenya was built. In March, U.S. President Bill Clinton visited the area, which is now just a ripple.

AES makes no secret that its chief executive officer is one of Clinton's many friends -- and that it has his support, as well as that of Ugandan President Yoweri Museveni. But the power company says it wants what's best for the people of Uganda.

"We were invited to this particular site because four international studies done previously, commissioned by the government of Uganda, looked at various potential hydro sites on the Nile, and after extensive studies chose Bujagali as one of the least (costly) and most environmentally benign sites," says Christian Wright of AES Nile Independent Power.

Part of the disputed section of the Nile River in Uganda

Rafting company wants dam built elsewhere

Though very much the minnow in this fight, the Adrift Rafting Company says Uganda can have both hydroelectric power and tourist dollars.

"In 30 years time, there will be a dam on this river," says Stephen Lineaweaver of Adrift. "With a little forethought now, we can place the dam on a another section of river, keep this intact, and you can have both the income from tourism and from the hydro power project."

Local residents seem to want the jobs and money a dam would bring, though for posterity a few leaders would like to see it built elsewhere.

"We realize that we'd like to have electricity," says Mathias Ngobi, a village elder. "But (at) the same time, once you destroy Bujagali, you (can) never recreate it."